Times are tough for all businesses at the moment, with firms of all sizes across the globe struggling to stay afloat.  For businesses to survive in the current economic climate, they’re going to need to cut costs.  The problem that many managers are facing is that it’s difficult to find areas to save money.  If you’re a small business owner, you’ve probably already spent a lot of time shopping around, finding the best deals, and considering whether or not you really need each product or service that you’re paying for.

If things are looking bleak, don’t rush to start trimming your payroll down just yet.  There may possibly be some savings left to be made.  Take a look at the following cost-cutting tips:

The Golden Rules of Cost Cutting and Business Management

There are two golden rules that, if followed, can make your cash flow look a lot prettier.

1. Pay your bills as soon as they’re due – no sooner, and definitely no later.

2. Get your income as soon as possible – send invoices immediately, and chase late payers.

Managing Your Cash When You Have It

  • If you’re in a cash-flow pinch, but know that it’s just a temporary situation, look for a line of credit with competitive rates.  An interest free overdraft that you stay within the terms of is a much better choice than a credit card.
  • Keep track not just of how much cash you have, but what sort of accounts it’s in.  Money that you can’t access easily isn’t much use to you if you have bills to be paid.
  • Keep track of your three lines of cash – paid bills, invoiced bills, and work in progress. Make sure you have a steady flow of money in all categories.

Often Overlooked Savings

British entertainment retailer GAME are reportedly facing tremendous struggles and are currently in the process of trying to sell before entering administration. One of the biggest issues for the GAME group of stores is that they have several stores with high rents, on long leases.  Now that there’s a recession going on, and people aren’t spending as much money on entertainment, the company still has to pay the rent on those expensive storefronts. Don’t make the same mistake with your company.

If you have a long lease, and are struggling, see if you can renegotiate your rent on the premise that the landlord would prefer reduced rent to an empty office.  If you can’t get reduced rent, see if you can sublet some of your spare space to another company.

Another area of possible savings if basic utility bills such as the phone, gas, and electric.  When was the last time you changed suppliers?  Consider using IP telephony for at least some of your calls.  You may even be able to cancel your phone package entirely in favour of an IP telephony service that can accept incoming calls.

Travel bills are another area where savings can be made.  If you’ve been feeling the pinch for a while, you might already have cut down on non-essential travel, but that doesn’t mean you have to miss out.  Video conferencing and IP telephony are both useful for talking to clients and suppliers, and if you want to attend conferences, you may be able to group up with related businesses in your area to take advantage of group discounts.